There is a discrepancy between buying and renting of homes. Renting of homes is when you pay a specified fee over a certain period of time to use the space, but the ownership does not change. On the other hand, buying a house is when the ownership shifts from the initial owner to the buyer once the specified amount is settled. Many people aspire to own homes. An individual can either buy or rent a home. Despite the financial pros of both renting and owning, renting is preferred by most people.
- Limited or no maintenance cost
Individuals will prefer renting to buying because there will be no or minimal maintenance and repair costs. Once you have rented space, the landlord is responsible for the repairs and maintenance. The financial responsibility is listed under the owner of the building. Therefore, in case of a leaking roof, you will contact your landlord. On the other hand, homeowners are responsible for the costs of repair, maintenance and renovation.
- Exemption of real estate taxes
The burden of the hefty real estate taxes is felt by homeowners. Therefore, a renter is not liable to pay the real estate taxes. The tax rates vary in different counties. The taxes are determined by the value of the property. Since most people opt to own a spacious home, this can contribute to as great financial burden.
- Access to amenities within the building
When you buy a home, you are bound to incur various amenities expenses. You will have to pay for installation and maintenance costs for the amenities such as swimming pools and gyms. Therefore, as a renter, you get to enjoy the amenities without paying additional charges.
- Minimum down payment
While moving into a rental property, you will not be required to pay large amounts of money. At some points it may seem like a lot, but it cannot be compared to the amount that you would use to acquire a house. In rental houses, the cost of deposit is distributed evenly among the tenants. The deposit amount varies among rental properties. Renting a house can help to avoid the high initial down payment that is required while buying a house.
- The reducing value of property
The value of the property is subjected to inflation and deflation. Such economic aspects affect homeowners and not renters. The value of the home is used to determine some of the expenses such as mortgage and tax to be paid. Despite the unstable nature of the housing market, the renters will not be affected by the changes in the value of property.
- Fixed Rent rates
Depending on the lease agreement, the amount of rent to be paid is fixed. The landlords can increase the rates but upon notifying the renters in advance. This means that you will have adequate time to decide if you will be able to pay the rent or not. On the other hand, the rates such as taxes and mortgages can fluctuate any time without notice since they are subject to economic forces.
These are some of the factors that can be used to determine if you should rent or buy a house. It is also important to consider the pros and cons of both buying and renting homes. This will help you to assess the financial situation and select the best alternative that will suit your budget in the short and long run. Select an option that will help cater to your needs at a minimum cost.
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